Paraguay's new president vows to recover pension funds at risk in Ueno Bank crisis

The president of Paraguay, Pedro Alliana, announced on Tuesday that the recovery of pension funds deposited in Ueno Bank will be a priority for his government. The intervention in the financial institution has put at risk around 800 million dollars (about 716 million euros) belonging to public bodies, including resources from five retirement funds, and has triggered a political crisis that ended with the removal of Santiago Peña from office.

Among the institutions affected is the Social Security Institute (IPS), which is responsible for managing pensions and part of the country's health services. Uncertainty over the recovery of these funds has caused growing concern among workers and retirees.

Alliana, who took over the presidency last Friday, has pledged to protect citizens' savings and to speed up compensation after the banking collapse.

Almost 95% of savers have already received compensation

The president has said that around 1.74 million depositors have received payments totalling 330 million dollars through the Deposit Guarantee Fund. The government plans to complete on Wednesday 11 November the outstanding reimbursements provided for in the emergency legislation approved by Congress.

However, the payments do not guarantee that all customers will recover the whole of their savings. The guarantee scheme covers up to about 38,600 dollars (about 34,575 euros) per depositor, while the initial advances are limited to approximately 20,000 dollars.

For many of those affected, the return of the money represents a first relief after several days of uncertainty. "At last they transferred the money I was missing," Rosario, a 45-year-old customer who preferred not to give her surname, told AFP.

A banking crisis that brought down the president

The intervention in Ueno Bank sparked mass demonstrations demanding both the return of deposits and the departure of then president Santiago Peña, who was linked to the financial institution.

Political and social pressure culminated in his removal through an impeachment trial in the Senate. His vice president at the time, Pedro Alliana, took over the government and accelerated compensation payments through the guarantee fund.

The crisis has also hit the labour market. According to Paraguayan labour minister Mónica Recalde, up to 7,000 people have lost their jobs in companies linked to the bank in Paraguay, Mexico, Nicaragua, Argentina and Panama.